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Keene Little : 7/1/2007 11:33:22 PM

While the DOW and SPX 60-min charts are very similar, especially with their broken uptrend lines from March, SPX could be the more important one to watch since the Fib projection for another leg up in its bounce off Friday's low (assuming we'll get another leg up) matches the broken uptrend line (which is where price stalled on Friday): Link

This uptrend line for the DOW is slightly above two equal legs up, at 13578, and bears watching for potential resistance as well: Link

The RUT and NDX remain in a very choppy pattern but the pullback in the RUT leaves the same kind of potential setup as shown for the DOW and SPX--another rally leg up which would likely drive the RUT to new all-time highs. Or it could just continue lower from here. Notice the very small bounce in the RUT late Friday as compared to the DOW and SPX. Link

The NDX daily chart shows an interesting possibility with an upward sloping diamond top, with the bearish divergences to go with it. It could easily chop its way higher in this pattern through July but a break below the bottom of it would be immediately bearish I think. Link The 60-min chart simply zooms in on the potential price paths from here and the key levels: Link

It will be interesting to watch this next chart over the next couple of months since the sideways triangle consolidation pattern is in its last leg up before the pattern is complete and starts heading back down: Link This is a relative strength chart of the COMP vs. SPX. When it dropped hard from the 2000 high it means it was outperforming to the downside. The latest little tick up in the past month means the COMP has been outperforming the SPX to the upside after hanging back for the past 6 months.

With the financials pressuring the SPX and the techs holding up better, this is reflected in the chart. But this pattern suggests it won't be long before the techs start heading back down at a faster clip than SPX (in other words, they'll lead the market to the downside again). Trade the long side but don't stay married to it.

Keene Little : 7/1/2007 10:40:25 PM

Monday's pivot tables: Link and Link

OI Technical Staff : 7/1/2007 9:59:59 PM

The Market Monitor has been archived. You may view it and any previous days here: Link

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Jeff Bailey : 7/1/2007 9:04:13 PM

China June Purchasing Managers Index 54.5 Vs 55.7 In May

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